PUBLIC PARTNERSHIPS

Public partnerships in case of turkey and the UK

Public Partnerships in Turkey and UK

Public-Private Partnerships in Turkey

The term “Public Private Partnership” (PPP) refers to a long-term, contractual partnership between public and private sector agencies (“Partner”), specially targeted towards financing, designing, implementing and operating infrastructure facility services that the public sector traditionally provided. United Kingdom was the first to introduce, systematic programme aimed at encouraging PPPs in the United Kingdom, with the establishment of the “PFI-Private Finance Initiative” in 1992. In a PPP, each Partner agrees to share responsibilities related to implementation and/or operation and management of a project (Bolgar, 2011, pp. 5). This collaboration or partnership has its foundation in the areas of expertise of each Partner, based on the allocation of:

Resources.

Risks

Rewards

Responsibilities

PPP investment models were first implemented in motorways, roads and other infrastructure projects. More recently, these models have been implemented in school and hospital constructions. The global volume and number of PPPs have increased significantly since the 1990s. Many countries, such as, the UK, Spain and Italy have started to implement PPP models for project financing. As of the end of 2006, the investment volumes of private sector entities in public projects reached EUR 63.7 billion in the UK, EUR 6.5 billion in Italy and EUR 2.5 billion, in Spain. PPP models vary from short-term basic management contracts (with or without investment requirements) to long-term and complex BOT projects. The most typical PPP models are as follows: PPP's models (Bora, 2005, pp. 7-15).

PPP Models

There are various PPP models that are implemented. Some of the PPP models are as follows:

Build- Operate- Transfer Model (BOT)

The private sector partner will finance the project, constructs and operate it, and at the end of the designated time, will return the property back to the administration.

Build- Rent- Transfer (BRT)

The private sector partner finances the project, constructs, rents the property to the administration for a designated period and returns the property to the administration at the end of the rental period (Peters, 1998, pp. 11-33).

Build-Operate (BO)

The private sector partner finances the project, constructs and operates it, after which the ownership of the property will eventually belong to the private sector partner.

Transfer of Operating Right (TOR)

The administration transfers its assets or one of its units to the private sector in consideration for payment and in order to transfer operation for a designated period. The ownership shall continue to belong to the administration (Pollock & Price, 2004, pp. 40-50). As mentioned above, several projects in Turkey completed under the BOT model of public-private partnership. The most well-known BOT projects can be listed as the Marmaray Bosporus Tunnel, the Zafer Airport in Kütahya, Istanbul - Izmir Motorway Project, the Göcek Tunnel Motorway Service Stations the Çeþme Marina in Ýzmir, the Yuvacýk power plant in Kocaeli, the Birecik power plant in Þanlýurfa, the Suçatý power plant in Kahramanmaraþ, and the Yamula power plant in Kayseri. Historically, concessions given to the private sector date back to the “Law on Concessions Related to Public Services” enacted in ...